Company Matter Litigation in Bangladesh 2026: Rectification, Oppression, Director Removal and Charges

Company matter litigation Bangladesh: the 2026 landscape

Company matter litigation Bangladesh lawyers handle has one natural home: the High Court Division sitting in its statutory original jurisdiction under the Companies Act 1994. That bench decides who is entered in the register of members, whether a missed annual general meeting can be cured, whether a majority has crossed the line into oppression, whether a director was removed lawfully and whether a lender that forgot to file its charge at the RJSC can still be saved. In 2026 a sequence of reasoned judgments has defined the limits of that jurisdiction with unusual clarity.

This guide brings together four topics that are usually written about separately: company matters before the company bench and how they are run, rectification of the register and of RJSC records, shareholder protection through section 233, removal of directors, and registration of charges with the RJSC, including late filing through the court. Detailed guides already published by TRW on shareholder disputes, corporate governance, object clause changes, winding up and secured lending are linked where they matter rather than repeated.

Summary: Statutory company disputes in Bangladesh are heard by the High Court Division under section 3 of the Companies Act 1994. The most common petitions seek rectification of the register of members under section 43, an order for or condonation of general meetings under sections 81(2) and 85(3) with relief under section 396, protection against oppression under section 233, sanction of schemes, winding up, and an extension of time to register a charge under section 171. The jurisdiction is summary and document-driven: contested title, missing parties and ordinary boardroom disagreements are sent elsewhere.

Key point: Section 43 corrects the register; it does not create title. In 2026 the High Court Division refused rectification where a special statute barred the transfer, where the current registered holders were not joined and where the same title dispute was pending in a civil suit, while granting it where the transfer instrument was clear or an allotment had ignored statutory pre-emption rights.

At a glance

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Table of Contents

What company matter litigation Bangladesh covers in 2026

A company matter is a proceeding brought under the Companies Act 1994 itself, rather than an ordinary civil suit about a company. The distinction matters because the statute gives the court specific, often summary powers, and each power has its own conditions. Company matter litigation Bangladesh practitioners run is therefore a matter of choosing the right section first and arguing the merits second.

The company bench and section 3

Section 3 provides that the court with jurisdiction under the Act is the High Court Division. The government may, by notification in the official Gazette, transfer any of those powers to a district court for companies whose registered office lies in that district, and a proceeding is not invalid merely because it was brought in the wrong court.[1] In practice company matters are filed in Dhaka and heard by a single judge assigned by the Chief Justice; the 2026 judgments discussed below come from benches presided over by Justice Md Toufiq Inam and Justice Sikder Mahmudur Razi.[9] [12]

The petitions the company bench hears

The Act contains many routes to the court, but a handful account for most of the list:

• Section 43: rectification of the register of members.
• Sections 81(2) and 85(3): court-called or court-supervised general meetings, usually combined with condonation of missed AGMs.
• Section 396: relief for directors and officers from liability for statutory defaults, typically sought alongside condonation.
• Section 233: relief for members against oppression or unfair prejudice.
• Sections 228 and 229: sanction of compromises, arrangements and amalgamations.
• Section 241: winding up by the court.
• Section 171: extension of time to register a charge, or correction of its particulars.

The headings of each of these provisions appear in the official text of the Act.[1] Object clause alterations under section 12 also require confirmation by the court, and are covered in our guide to changing the object clause of a memorandum. Merger sanction is covered in our guide to the merger procedure in Bangladesh, and winding up in winding up a company in Bangladesh.

What does not belong on the company bench

A breach of a shareholders' agreement, a claim for the price of shares or a damages claim against a seller is a contract claim. It belongs in the civil or commercial courts, or in arbitration if the agreement says so. The company bench has repeatedly said that its statutory jurisdiction cannot be used to enforce contractual equities between transferor and transferee.[6] A dispute that mixes statutory and contractual claims needs careful sequencing, which our guide to shareholder disputes in Bangladesh addresses from the strategic side.

Procedure in company matter litigation Bangladesh: petition to judgment

Company matter litigation Bangladesh courts handle moves on paper. The judge decides most of them on the petition, the affidavits and the annexed corporate documents, without oral evidence. That makes the drafting stage decisive.

The petition and the affidavit

The petition names the sections invoked, sets out the company's capital and shareholding history, identifies the impugned resolutions, transfers or filings, and states precise prayers. It is verified by affidavit and annexes the memorandum and articles, register extracts, RJSC filings such as Schedule X or Form XII, transfer instruments in Form 117 and the relevant minutes.[5] [10] Respondents answer by affidavit-in-opposition, and either side may file supplementary affidavits to bring later events on record.[12]

Parties: join everyone whose name is on the register

The most common avoidable failure is non-joinder. In Mohammad Quyaum v National Drug Co Ltd (Company Matter No. 368 of 2024, judgment of 28 June 2026) the court refused to set aside an allotment of 2,00,000 shares and the later transfers because shares transferred during the proceeding were now registered in the names of third parties who had not been impleaded. Every person whose name stands in the register for the disputed shares is a necessary party under section 43.[5] The company, its directors and, where its records must change, the RJSC should also be joined.

Notice and newspaper publication

Where the order sought affects people beyond the named parties, the court commonly directs publication of notice. In Sharif Shah Kamal v RJSC (Company Matter No. 340 of 2026, judgment of 26 July 2026), notices were published in two widely circulated daily newspapers inviting objections from shareholders, creditors and other interested persons, and an affidavit-in-compliance was filed before the petition was decided.[12]

Interim orders

In company matter litigation Bangladesh judges decide, interim relief is often the real battleground: a status quo on the register, a stay on a general meeting, or an order on bank signatories. These orders bind until recalled, and disobedience exposes the respondents to contempt. In A.M. Mahmudur Rahman v Uttara Club Ltd (Company Matter No. 1533 of 2025, judgment of 15 June 2026), the court held that respondents could not justify acting against a subsisting interim order by pointing to a pending leave petition in the Appellate Division, although it ultimately declined to punish them and cautioned them instead.[9] When the main petition fails, interim orders are vacated, as they were in the Nigom Builders matter.[11]

Judgment, compliance and appeal

Final orders typically direct the company to rectify its register or hold meetings within a fixed time and direct the RJSC to give effect to the order on production of a certified copy. Orders of the company bench are taken to the Appellate Division by civil petition for leave to appeal, as happened in the Uttara Club matter.[9] Costs follow discretion: in a failed meeting challenge in August 2026 the court ordered the petitioner to pay Tk 50,000.[13]

The working sequence below is how we prepare a company matter for filing.

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Rectification of the register of members under section 43

Section 43 lets the court order rectification where a person's name has been entered in or omitted from the register of members without sufficient cause.[1] [7] It is the most frequently used tool in company matter litigation Bangladesh offers, because the register decides who votes, who receives dividends and who has standing to bring every other remedy. Four judgments delivered between June and August 2026 show where its edges lie.

Title passes through the transfer instrument

In National Drug the petitioner relied on a Form 117 transfer of 1,000 shares; the respondent relied on later board resolutions, Schedule X filings and an affidavit. The court held that those later records were derivative and could not prevail over the operative transfer instrument unless it was shown to be forged or invalid. Representations to a bank and an affidavit to the RJSC stating the parties' shareholdings were treated as admissions. Payment of the price by someone else did not change ownership. The register was ordered to be rectified within 30 days, with bonus shares and accretions, and the petitioner was allowed to take up a proportionate share of a later allotment.[5]

Allotments that ignore pre-emption rights

In Mukta Rani Ghosh v Purobi Jewellers (Pvt) Ltd (Company Matter No. 1965 of 2025, judgment of 6 August 2026), a majority shareholder was diluted by an allotment of 2,70,000 new shares to two other shareholders. The company could not prove that the statutory offer under section 155 had been communicated to her. The court declared the allotment illegal, expunged the resulting entries and directed the RJSC to record the restored position. Commercial need for capital, it held, cannot override a mandatory shareholder safeguard, and entries founded on a non-compliant allotment are entries made without sufficient cause.[7]

When a special statute bars the transfer

In United Enterprises and Company Ltd v RJSC (Company Matter No. 459 of 2024, judgment of 2 August 2026), a buyer had paid about Tk 50.89 crore under share purchase agreements for shares in Shahjalal Islami Bank PLC, but the bank refused registration. The court found a concluded contract between buyer and seller, yet dismissed the petition: where the Bank Company Act 1991 prevented the bank from recognising the transfer, the refusal was not without sufficient cause. Section 43 is corrective, not a source of substantive rights, and cannot be used to override a special statute.[6] Buyers of regulated-sector shares should make regulatory clearance a condition precedent, as our guide to the share purchase agreement in Bangladesh explains.

Summary jurisdiction and pending civil suits

In Ali Haider Ratan v Khudeja Bohumukhi Farm Ltd (Company Matter No. 287 of 2024, judgment of 25 June 2026), brought under sections 43 and 81(2) read with section 396, the court rectified the register for 3,750 shares that the transferor had plainly agreed to sell and did not contest. It refused relief for 5,000 shares where payment of consideration to the registered holder was unproven, and declined to rule on 1,250 shares whose validity under the articles' pre-emption clause was already before a civil court in a title suit. It also held that rectification of shares confers no right in the company's assets, there a leasehold tea estate.[8]

Correcting RJSC records and amendments

Many company matters are, in substance, requests to correct the public record. The court can direct the RJSC to cancel or reverse a submission and accept rectified filings. In Sharif Shah Kamal it directed the Registrar to reverse a submission relating to a proposed share transfer and restore the company's records within 60 days.[12] Petitioners who attack Form XII filings recording new directors must still show standing under the section they invoke.[10] Alterations to the memorandum remain court-confirmed for now; a draft Companies (Third Amendment) Act 2026 would move that approval to the RJSC.[16]

Court-ordered meetings and condonation: sections 81(2), 85(3) and 396

Section 81(1) requires an AGM in every calendar year with no more than fifteen months between meetings, and lets the Registrar extend the time for any AGM other than the first by up to ninety days or to 31 December, whichever is earlier, on an application made within thirty days of the deadline. Under section 81(2), if a company defaults, any member may apply to the court, which may call or direct the calling of an AGM and make consequential and incidental orders for convening, holding and conducting it.[1] The Registrar's extension route is explained in our object clause and AGM guide; this section deals with the court route.

Condoning years of missed AGMs

Companies that have fallen several years behind cannot repair the position at the RJSC alone. In Sharif Shah Kamal the court condoned the failure to hold AGMs for 2022 to 2025 under sections 81(2) and 85(3), ordered the outstanding meetings to be held by 30 December 2026, required all returns and audited accounts to be filed promptly afterwards and exonerated the directors and officers under section 396.[12] The petition succeeded because the delay was explained, notice had been published and no shareholder or creditor objected.

When a meeting is said to be impracticable

Section 85(3) is not a general power to rerun elections. In Abdullah Ahmed v RJSC (Company Matter No. 693 of 2026, judgment of 9 August 2026), a member of a club company asked the court to invalidate an AGM held on 27 December 2025 and to order fresh AGMs for 2021 to 2025 under an independent chairman. The court refused: the AGM had been called and held, a committee was functioning, and the irregularities could be corrected without unsettling completed proceedings. The jurisdiction exists to cure impediments, not to create deadlock, and the petition was dismissed with costs.[13]

Shareholder protection: oppression and prejudice under section 233

Section 233 is the statutory shareholder protection remedy. Members or debenture holders may apply on the ground that the company's affairs are being conducted, or the directors' powers exercised, in a manner prejudicial to their interests, or that the company has taken or is about to take action that unfairly alters their interests. The court sends the application to the board and fixes a hearing. If unfair prejudice is shown, it may cancel or modify a decision or transaction, regulate the future conduct of the company's affairs or amend the memorandum or articles, and the company must notify the Registrar of the order within 14 days.[4]

Standing is a gateway, not a technicality

Applicants must meet the qualification in section 195, which for a company with share capital means holding at least one-tenth of the issued capital. In Abul Kalam Azad v Neptune Land Development Ltd (Company Matter No. 465 of 2026, judgment of 13 July 2026) the petition was dismissed as not maintainable because indirect interests held through a corporate shareholder do not count as membership.[10] The court nonetheless reminded the board that board powers are fiduciary and that a controlling majority cannot disregard the statutory rights of other shareholders.[10] Our guide to company law in Bangladesh analyses the threshold in more depth.

Internal management is not oppression

In Md Shafiqul Islam v Nigom Builders Ltd (Company Matter No. 475 of 2023, judgment of 28 June 2026) a former managing director complained that board resolutions had removed his mandatory signature on the company's bank accounts. The court held that bank mandates were a matter of internal management within the board's authority under the articles, and that it does not sit in appeal over every managerial, commercial or administrative decision of the board. Intervention requires conduct that is burdensome, harsh or wrongful, lacking in probity or calculated to prejudice shareholders' proprietary or participatory rights.[11]

The court did not simply dismiss the petition. Given the cross-allegations of financial irregularity, it directed the board to appoint an independent chartered accountant to audit the accounts and report to the board and the shareholders, preserving remedies for any misappropriation found.[11] That pattern, refusing the declaration but ordering transparency, is a useful outcome for a minority that cannot yet prove its case.

Choosing between the remedies

Shareholder protection rarely depends on one section. A shareholder who has been written out of the register should start with section 43; a shareholder kept in the dark about meetings may use sections 81(2) and 85(3); a qualifying minority facing a pattern of exclusion should use section 233; and a winding-up petition under section 241 is a last resort, usually filed to force a negotiated exit.[1] The table compares them. On a phone, scroll it sideways.

Director removal in Bangladesh: section 106, the articles and the court

The common assumption, borrowed from English law, that shareholders can remove a director by ordinary resolution is wrong in Bangladesh. Section 106 of the Companies Act 1994 is headed "removal of directors".[1] It allows the company to remove a shareholder-elected director before the end of his term by extraordinary resolution and to appoint a replacement by ordinary resolution. It does not reach contractual appointees, such as nominees of a lending bank under a loan agreement.[14]

Resolution, notice and the right to be heard

An extraordinary resolution is a members' resolution passed in general meeting under the special-majority rules of section 87, not a board decision.[1] Academic analysis of section 106 reads it as requiring special notice to members at least fourteen days before the meeting, a copy to the director concerned, a right for the director to be heard and to make written representations, and a route to court if those representations are suppressed.[14] Prudent companies follow every one of those steps, because a removal that skips them invites a petition and an interim stay.

Removal under the articles and natural justice

Many articles add their own grounds and procedures for disqualification or removal. The Uttara Club matter shows how the court reviews them. The petitioner, a director and permanent member, was removed and expelled at an extraordinary general meeting after a show-cause process under the articles. The meeting called for 12 April 2025 was stayed by a High Court order, the stay was itself stayed by the Appellate Division, and the meeting was held on 3 May 2025 without fresh 21 days' notice.[9]

The court held that a stay merely pauses a duly convened meeting; once lifted, the meeting may proceed on the original notice. The petitioner had been given the allegations, had answered them, sought adjournments and attended the meeting, so acquiescence and estoppel barred a later procedural attack. With the removal valid, no rectification of the register arose under section 43.[9] The lesson for boards is that a documented, fair process will survive challenge; for directors, that objections must be taken promptly and not after taking part.

Managing directors and board-level changes

Removing a person from an executive office, such as managing director, is different from removing him from the board. The board appoints and controls executive offices under the articles; only the general meeting can remove an elected director under section 106. In Nigom Builders the petitioners argued that a nine-day notice for the meeting that removed the managing director was fatal; the court analysed the dispute as one of internal management and found no oppression.[11] Our guide to corporate governance and directors' duties covers appointment, disqualification and board conduct.

Listed companies and BSEC rules

For listed companies the BSEC Corporate Governance Code adds a layer. Independent directors are appointed by the board and approved by shareholders at the AGM, serve a three-year term extendable once, and the post may not stay vacant for more than 90 days.[15] The Code itself contains no separate procedure for removing an independent director, so removal still runs through the Companies Act and the articles, and any vacancy must be filled within the Code's timetable.[15]

How a removed director fights back

A removed director has four practical routes: an urgent challenge to the meeting with interim relief, a section 233 petition if he and his allies hold one-tenth of the issued capital, a section 43 petition where removal from membership has followed, and a civil suit for breach of any service contract. The Neptune Land petition, which sought to declare board resolutions and the consequential Form XII void, failed at the threshold, a reminder that standing comes before merits.[10] In each case the RJSC record will reflect the board's filing until the court orders otherwise.

Charge registration with the RJSC and the court's role

Charge registration is the point at which secured lending meets company matter litigation Bangladesh courts decide. Section 159 requires the particulars of a charge created by a company, with the instrument or a certified copy, to be filed with the Registrar within 21 days of its creation. It applies to charges securing debentures, charges on uncalled share capital, charges on immovable property wherever situated, charges on book debts, charges on movable property other than stock-in-trade, and floating charges on the undertaking or property.[2] The documentation and perfection steps are covered in our guide to loan security documentation in Bangladesh.

The consequence of missing the deadline

An unregistered charge is void against the liquidator and any creditor so far as it secures the company's property. The debt itself survives, and the money secured becomes immediately repayable. For a charge created abroad over property in Bangladesh, time runs from when the instrument would have reached Bangladesh if posted with due diligence. Registration gives notice of the charge to anyone who later acquires the property or an interest in it.[2] The practical effect is stark: in a liquidation, a lender with an unfiled charge ranks as an unsecured creditor.

Late registration through the court under section 171

The cure is a petition under section 171. The court may extend the time for registration, or order an omission or misstatement to be rectified, where the failure was accidental, inadvertent or due to other sufficient cause, where it does not prejudice creditors or shareholders, or where relief is otherwise just and equitable. The company or any interested person may apply, the court may impose terms, and the order is without prejudice to rights acquired in the property before the charge is actually registered.[3] Delay is therefore dangerous twice over: an intervening creditor's rights survive, and an intervening winding-up order may end the argument.

Satisfaction and release

The Act separately provides for the company's duty to register charges and the right of an interested party to do so, and for registration of satisfaction when the secured debt is repaid.[1] Section 171 also covers the case where the Registrar was not told that the secured debt had been paid, so a borrower whose record still shows a discharged charge can seek correction through the court.[3] The draft Third Amendment would extend the deadlines for registering a charge and notifying its satisfaction from 21 to 30 days, and allow electronic registers of charges.[16] Until it is enacted, 21 days remains the rule. For security over movables outside the company regime, see our guide to secured transactions in Bangladesh.

Critical mistakes in company matter litigation Bangladesh

The same errors appear in petition after petition, and each one weakens a client's position in company matter litigation Bangladesh courts will hear on documents alone. Each is avoidable.

• Using section 43 to try title. If ownership turns on disputed payment, forgery or the meaning of the articles, the court will decline relief or leave the issue to a civil suit.[8]
• Leaving out the current registered holders. Transfers made during the case must be tracked and their holders joined, or relief against them fails.[5]
• Counting indirect holdings for section 233. Only shares registered in the petitioners' own names count towards one-tenth.[10]
• Treating board disagreements as oppression. Bank mandates and similar management decisions are for the board unless probity or shareholder rights are engaged.[11]
• Removing a director by board resolution. Section 106 requires an extraordinary resolution of members.[14]
• Participating, then objecting. A member who attends and contests a meeting may be estopped from attacking its notice afterwards.[9]
• Filing charges late and hoping. Every day between creation and a section 171 order is a day in which third-party rights can accrue.[3]
• Ignoring interim orders. A pending leave petition does not suspend an order of the High Court Division.[9]

What to watch for the rest of 2026

Three developments will shape company matter litigation Bangladesh clients face over the next year. First, the draft Companies (Third Amendment) Act 2026 would introduce electronic registers of members, transfers and charges, declarations where a registered shareholder is not the beneficial owner, with fines of up to Tk 50,000, and RJSC rather than court approval for memorandum alterations.[16] Beneficial-ownership declarations could change how the court approaches nominee holdings in rectification and standing disputes.

Second, the company bench continues to produce detailed, reasoned judgments on section 43 and section 233, and those decisions are published on the Supreme Court website. Third, the commercial courts created in 2026 hear defined categories of commercial dispute, which makes the choice between a company petition and a commercial suit more consequential than before.

If a register entry, a meeting, a removal or a charge is about to be challenged, the first fortnight decides most outcomes. Our corporate and shareholder disputes practice and corporate governance and compliance practice act on both sides of these petitions. Contact TRW to review your position.

Frequently asked questions

Which court hears company matter litigation Bangladesh petitions?

The High Court Division, under section 3 of the Companies Act 1994. The government may transfer powers to a district court by gazette notification, but in practice company matters are heard by the company bench in Dhaka.[1]

What is rectification of the register of members?

An order under section 43 correcting the register where a name was entered or omitted without sufficient cause. It is summary relief and is refused where title is seriously disputed or necessary parties are missing.[1] [5]

Can the court rectify the register if I paid for shares under a share purchase agreement?

Not if the company was legally barred from registering the transfer. In August 2026 the High Court Division held that a share purchase agreement creates contractual rights but no statutory right to be entered in a bank's register where the Bank Company Act 1991 prohibits recognition.[6]

Who can bring an oppression petition under section 233?

Members or debenture holders meeting the section 195 qualification, which for a company with share capital is one-tenth of the issued capital held in their own names. Beneficial interests held through another company do not count.[4] [10]

How is a director removed in Bangladesh?

A shareholder-elected director can be removed before the end of term under section 106 by extraordinary resolution at a general meeting, with a replacement appointed by ordinary resolution. Contractual nominee directors fall outside the section.[14]

Can a removed director challenge the removal?

Yes, by challenging the meeting and seeking interim relief, by a section 233 petition if the threshold is met, or by section 43 if membership was also removed. A director who took part in a properly noticed meeting may be estopped from complaining later.[9]

What if our company has not held AGMs for several years?

Apply to the High Court Division under sections 81(2) and 85(3) for condonation and directions, with relief for directors under section 396. In July 2026 the court condoned four years of missed AGMs and fixed a deadline to hold them.[12]

What is the deadline for registering a charge with the RJSC?

Twenty-one days from creation of the charge under section 159 of the Companies Act 1994. A draft amendment would extend this to 30 days, but it has not been enacted.[2] [16]

What happens if a charge is not registered in time?

It is void against the liquidator and any creditor, and the secured money becomes immediately repayable. The company or any interested person can apply under section 171 for an extension, which does not affect rights acquired before actual registration.[2] [3]

Can company matters go to arbitration or the commercial courts?

Statutory petitions under the Companies Act stay with the High Court Division. Contract claims between shareholders, such as breach of a share purchase or shareholders' agreement, belong in the civil or commercial courts or in arbitration if the agreement provides for it.[6]